United States military members who serve in a combat zone are able to exclude certain pays from their taxable income for the year under the Combat Zone Tax Exclusion (CZTE). A common question asked by both those being deployed and their loved ones, is what exactly are the designated combat zones for 2018? For every month (or portion of a month) that a member is deployed, he or she will be able to exclude all enlisted pay, and for officers all pay equal to that of the maximum enlisted pay plus Imminent Danger and Hostile Fire pay for the month. To help you better understand what pays or entitlements that you can expect to receive on deployment, we have included the listing of IRS recognized combat zones which is also thoroughly covered in IRS Publication 3, Armed Forces Tax Guide.
What Does the IRS Mean by the Term Combat Zone?
For the IRS, the term “combat zone” is more general in nature. It is used as a catch-all to include every type of qualifying area that the military may serve that qualify the individual for tax free pay. These areas include: actual combat areas, direct combat support areas, and contingency operations areas.
What are Current Recognized Combat Zones?
Current Recognized Combat Zones for 2017, 2018
Last updated: November 7th, 2017
Through the signature of Executive Order No. 13239, Afghanistan (and the airspace above) was designated as a combat zone beginning September 19, 2001 and remains in effect at the time of this writing.
Additionally, U.S. DoD designated the following countries to be eligible for combat zone benefits and tax free pay based on the direct support of military operations:
-Jordan, Kyrgyzstan, Pakistan, Tajikistan, and Uzbekistan (as of September 19, 2001)
– Philippines (from January 9, 2002 through September 30, 2015)
– Djibouti (as of July 1, 2002)
– Yemen (as of April 10, 2002)
– Somalia and Syria (as of January 1, 2004)
Note 1: For the Philippines deployments only, the personnel must be deployed in conjunction with Operation Enduring Freedom supporting military operations in the Afghanistan combat zone.
Through Executive Order No. 13119, the following locations (and the airspace above) were designated as a combat zone beginning March 24, 1999.
– The Federal Republic of Yugoslavia (Serbia/Montenegro)
– The Adriatic Sea
– The Ionian Sea – north of the 39th parallel
Note. The combat zone designation for Montenegro and Kosovo (previously a province within Serbia) under Executive Order 13119 remains in force even though Montenegro and Kosovo became independent nations since EO 13119 was signed.
Arabian Peninsula Area
Through Executive Order No. 12744, the following locations (and the airspace above) were designated as a combat zone beginning January 17, 1991.
– The total land areas of Iraq, Kuwait, Saudi Arabia, Oman Bahrain, Qatar, and the United Arab Emirates
– The Arabian Gulf
– The Red Sea
– The Gulf of Oman
– The part of the Arabian Sea that is north of 10 degrees north latitude and west of 68 degrees east longitude
-The Gulf of Aden
The following countries were certified by the Department of Defense for combat zone tax benefits due to their direct support of military operations in the Arabian Peninsula combat zone.
– Jordan (as of March 19, 2003)
– Lebanon (as of February 12, 2015)
Combat Zones Approved for Tax Benefits (IRS)
Combat Zone Tax Exclusion (CTZE)
For additional information on possible changes to this benefit as a Wounded Warrior, please visit the Wounded Warrior Pay section of the Defense Finance and Accounting Services (DFAS) website at: